They didn't put dragons in BECAUSE they couldn't fit in all the data.... Xboxs' only can hold so much you know. They tried to get as much on as they can. Oh well just play the game how it is until they get Fable 2 out with dragons and snow trolls.....

As long as the records show, Jack has always been alive. Even before the race of man was created is albian. But it’s not the immortality of Jack himself, it’s his soul which is contained in his mask. It is said that he continues to live through the human vessels that find his mask and crave its power.